Dirk Riehle's Industry and Research Publications

Commercial Open Source: Faster, Better, Cheaper, and More Easily?

I’m trying to create a pithy statement as to how commercial open source firms are superior to traditional (closed source) software development firms. For that, I need to define what the specific effects are that using an open source go-to-market strategy has on the bottom line. (If your answer is “it’s the community, naturally”—that’s not the intent of my question.) So far, I’ve been enumerating the benefits by business function, that is:

A commercial open source firm can

  1. go to market faster
  2. with a superior product
  3. at lower overall costs, and
  4. sell it more easily

than possible for traditional closed source competitors. I think that’s it: Faster, better, cheaper, and more easily.

As you can see, I’ve basically enumerated the various business functions as you might find them on a firm’s income statement. (1) and (2) address product management and engineering, (3) addresses pretty much all business functions, and (4) addresses marketing and sales. Anything that I should add? Rearrange things? Take a totally different perspective? Thanks for any thoughts you might have!



  1. Dirk Riehle Avatar

    Hi Tarus, thank for the comment, but I challenge you to “proof” it to me.
    Every commercial open source vendor I know tries to skew the situation to its own benefit such that it becomes really hard if not impossible for the customer to “continue without them since the software is free.”
    There are many ways of keeping customers locked in. The open core model, where you lock-in customers with proprietary extensions, is one form. You don’t get lock-in by way of copyright if you only use the free community edition, but of course by way of trademarks and patents, really rabid vendors would still be able to get to you… (not that this would be smart).
    I think the notion of “free as in freedom” is overhyped with most commercial open source software.

  2. Tarus Avatar

    You left off that open source shifts the power over the software from the vendor to the client. The vendor then has to work harder to prove their value (and their prices) since the client can always continue on without them since the source is free.

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